Clinical Trials Head East to Asia

The rising cost of drug development and the decreasing proportion of drug-naive population in the US and European markets are driving international pharmaceutical companies to consider emerging markets as a location to conduct their clinical trials. This shift in focus is also largely due to the notable clinical development in these markets and the potential for enhanced revenue growth. Asia stands out among the emerging markets given its double-digit growth rates (1). According to ClinicalTrials.gov, the number of clinical trials conducted in the US declined from 5159 in 2009 to 4530 in 2012 while the number of clinical trials increased from 1297 to 1614 for developed Asia Pacific (APAC) nations, and from 1196 to 1458 in developing APAC (2).

The fragmented APAC region, however, raises challenges for players operating within the region because there is no harmonized set of clinical trial regulations to adhere to, noted Cher Boon Piang, pharmaceutical and healthcare analyst at Business Monitor International (BMI) Asia. Some countries require clinical trials to be conducted within their boundaries. For example, Vietnam requires firms to conduct domestic clinical trials before marketing approval “for all pharmaceuticals that have not been made available in their country of origin for more than five years” (3). This requirement is also applicable to “new variations of pharmaceutical products already registered in Vietnam.” The same prerequisite is adopted in countries such as China, Japan, and South Korea, which could potentially cause delays and affect revenue-generating opportunities. Other challenges include delays in approvals and language barrier, Cher told BioPharm International. In November 2012, CEO of Eli Lilly, John Lechleiter, stated that approval for clinical trials would take 12 to 18 months in China, in contrast to several weeks in the US. Medpace director of clinical operations, Mainfong Ang, commented that start-up of clinical trials may take up to 96 weeks in China compared to 24 weeks in South Korea. All trial applications in China must be written in standard Chinese. In South Korea, the National Health Information System is mainly written in Hangul, and an interpreter is required if the study monitor cannot understand the local language. As a result, there has been a growth of contract research organizations (CROs) in the region.

“Globalization of trials is an essential prerequisite in drug development to test drug efficacy and safety across different ethnic groups, climatic conditions, and other notable external factors. This criterion encourages outsourcing of research and clinical testing due to the wide global presence of large CROs against in-house R&D resources,” commented Rhenu Bhuller, senior vice-president, healthcare, Frost & Sullivan. In October 2013, UK-based CRO TranScrip Partners opened an office in Hong Kong in a move to consolidate their presence in APAC while Australia-based CRO Novotech established two new clinical research sites in Hong Kong and Philippines in July 2013.

It is apparent that the government’s involvement is imperative to develop and/or improve the clinical-trials sector. “Governments should ensure sufficient provision of skilled scientists, researchers, and world-class research institutes; drive industry, academia, and small medium enterprises partnerships; and provide a strong healthcare-technology clusters of businesses, universities, and venture capitalists,” said Bhuller. “In addition, there should be efficient regulation of the clinical research environment, which facilitates setting up and smooth running of local clinical trials and provides for R&D tax credits among others.”

Progress is more pronounced in developed countries such as Korea and Singapore. In July 2013, the Health Ministry in Korea announced that it will commit $8.9 billion on projects to develop 20 new drugs over the next five years with private domestic drug manufacturers. It has also established a $448-million fund to assist local firms to expand their global presence. On Sept. 1, 2012, Singapore launched its clinical-trials registry that provides an option for patients not responding to existing treatment. Patients who opt to undergo these trials pay little or nothing for these treatments.

The success of the clinical-trials sector is dependent on many factors. “These include the cost of conducting the trial, government regulations, the importance of the biomedical sector, innovation levels, and the respect for intellectual property of the country,” commented Cher. “Innovation influences the clinical-trials sector in many ways. We note that countries with reasonably high standards of innovation (e.g., countries that develop innovative drugs) contribute to the vitality of the clinical-trials sector. Generally, knowledge-based economies are more innovative in product development or other business solutions.”

Future outlook
BMI has a positive outlook of clinical-trials sector in APAC due to the efforts of the respective governments to provide better healthcare and the strong state support for pharmaceuticals and biotechnology investments. According to Cher, “the continual improvements in regulation help to improve business environment that will attract pharmaceutical firms and healthcare providers to invest in the region.”

Frost & Sullivan shares an upbeat perspective of the clinical-trials industry in Asia. Global pharmaceutical companies are looking to relocate their R&D activities to more attractive geographies such as China, India, Korea, and Singapore that offer significant expertise as well as the potential to reduce R&D cost and development time, Bhuller commented. One benefit is the rapid patient enrollment for clinical studies although recruitment is now becoming more difficult because of more stringent trial requirements and the volume of trials and advancement in treatment, thereby, leaving less treatment-naive patients in the pool. Companies are finding that they have to go to smaller cities to get patients for their trials. Other benefits include accelerated product launches by tapping into large, diverse, and treatment-naive patient pools; capitalizing on the local intellectual capital, talent pool, and innovation potential; early access to emerging markets; all of which support the growth of companies in Asian economies.

Governments in APAC are embracing these opportunities and are offering incentives and infrastructure to attract companies to undertake R&D, leading to an increase in the number of pharmaceutical R&D centers in Asia Pacific. As more companies begin to concentrate in China, Japan, India, and Singapore, we will likely see a more balanced industry rather than a US/EU-dominated one.